AUD/USD fails to recapture 0.7200 level amid sustained USD buying interest

  • AUD/USD gains some traction in reaction to better than expected Australian GDP figure.
  • Some continuation buying around the USD and global growth concerns weigh on the pair.
  • A positive risk tone helps limit the downside as investors await US data for further momentum.

The pair AUD/USD has attracted some buying during the early part of Wednesday, although it has struggled to capitalize on the move and has encountered fresh selling near the 0.7200 level. At time of writing, the pair trades at 0.7184, up 0.14% on the day.

The US dollar took advantage of the previous day’s strong rebound from a one-month low and remained supported by rising US Treasury yields, reinforced by the statements of the governor of the Fed, Christopher Waller, who was very aggressive. At an event in Frankfurt on Monday, Waller advocated a 50 basis point rate hike during several meetings until inflation comes back close to the central bank’s target.

Furthermore, the concern for weakening global economic growth turned out to be another factor that benefited the safe-haven USD. This largely overshadowed the better-than-expected Australian GDP data, and didn’t help the AUD/USD pair capitalize on its modest rally, but instead attracted some selling near the multi-week high reached the previous day.

Government data showed that the australian economy expanded by 0.8% during the first quarter of 2022, compared to the 0.7% increase expected. However, this data was a sharp slowdown from the 3.4% growth recorded in the previous quarter and failed to provide a significant boost to the AUD/USD pair. The subsequent pullback supports the prospect of further intraday losses.

However, the decline is supported by a good rally in US stock index futures. The mix of fundamental factors warrants some caution before opening aggressive directional positions. Investors are now looking to the US economic calendar, with the release of the manufacturing PMI and JOLTS job openings, to gain some momentum at the start of the American session.

AUD/USD technical levels

AUD/USD

Panorama
Last Price Today 0.7184
Today’s Daily Change 0.0010
Today’s Daily Change % 0.14
Today’s Daily Opening 0.7174
Trends
20 Daily SMA 0.7053
50 Daily SMA 0.7246
100 Daily SMA 0.7231
200 Daily SMA 0.7259
levels
Previous Daily High 0.7204
Previous Daily Minimum 0.715
Previous Maximum Weekly 0.7167
Previous Weekly Minimum 0.7034
Monthly Prior Maximum 0.7267
Previous Monthly Minimum 0.6828
Daily Fibonacci 38.2% 0.717
Daily Fibonacci 61.8% 0.7183
Daily Pivot Point S1 0.7148
Daily Pivot Point S2 0.7121
Daily Pivot Point S3 0.7093
Daily Pivot Point R1 0.7202
Daily Pivot Point R2 0.723
Daily Pivot Point R3 0.7257

Source: Fx Street

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